Japan Preparing for Abolition of Paper Promissory Notes, Checks

Tokyo, Sept. 7 (Jiji Press)--Many financial institutions in Japan are set to end the issuance of paper promissory notes and checks on Sept. 30, ahead of the abolition of their use in March next year, to ensure a transition to internet banking and electronic payment services.

From Oct. 1, payments from checking accounts via paper promissory notes and checks will no longer be available in principle.

The Japanese Bankers Association and others are urging users of such financial instruments, mainly small and midsize businesses, to shift to electronic payment services, including a system operated by a subsidiary of the JBA for electronically recorded monetary claims.

While promissory notes and checks have been used as means of settlement between companies, they have had problems such as the risk of loss or theft and the time required for funds to be credited.

Digitizing the procedures is expected to reduce related workloads and costs.

[Copyright The Jiji Press, Ltd.]